NOTE: This case is complicated. I have endeavored to edit it such that it most closely resembles contemporary English but in some instances that was not possible. Have patience when reading it and do not spend more than 20 minutes on it.
SUMMARY OF FACTS: The Bank of the United States brought suit against the state auditor of Ohio (Osborn) in federal court seeking an injunction to stop Ohio from collecting a tax the Bank believed was unconstitutional. Historically, the States opposed the Bank of the United States and often levied punitive taxes against it. Even though the court granted the Bank a temporary injunction, the state auditor forcibly entered the bank and took the money he claimed state was owed. The court ordered the state officials to return the money, who in response argued that the federal courts had no subject matter jurisdiction.
Vernon Minton developed a computer program (“TEXCEN”) for securities trading in the early 1990s. He leased it in 1995 to a securities brokerage. He applied to patent TEXCEN a little more than a year later, and the patent was issued in 2000.
Minton then sued NASDAQ for patent infringement, represented by Mr. Gunn. NASDAQ obtained summary judgment on the grounds that the patent was invalid; an inventor is not entitled to a patent if “the invention was . . . on sale . . . more than one year prior to the date of the application,” and Minton had leased TEXCEN to Stark more than one year prior to filing his patent application. 35 U.S.C. § 102(b).
Minton then filed a motion for reconsideration arguing for the first time that the lease agreement was part of ongoing testing of TEXCEN and therefore fell within the “experimental use” exception to the [one year rule]. The District Court denied the motion on the grounds that the experimental use argument was waived, Minton appealed, and the U.S. Court of Appeals for the Federal Circuit affirmed.
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